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Temur Durrani

Multi-Platform Writer


Furniture produced in China and Vietnam will face tariffs of up to 204 per cent when it enters Canada, a precedent-setting federal tribunal has ruled — adding fuel to the fire in an already frenzied industry dispute.

Canada’s International Trade Tribunal found in a unanimous and landmark decision late this week that those two countries have unfairly dumped and subsidized their products for years, “causing injury to the domestic industry.”

It all started when Winnipeg-based Palliser Furniture, along with four other producers, launched a complaint to the Canadian Border Services Agency last year. 

Fairly quickly, a heated quarrel emerged — with Canada's largest furniture manufacturers on one side and the council representing a majority of the country's retailers on the other.

Manufacturers argued that dumping practices were happening in the country with upholstered products from China and Vietnam exported at much cheaper prices than in their home markets. 

That prompted a swift probe, with hefty preliminary provisional duties as high as 296 per cent introduced in early 2021, which the Retail Council of Canada began to aggressively argue and lobby against.

The council believed that manufacturers like Palliser weren’t “innovating enough” or “offering well-priced products” for retailers, who were forced to turn to foreign sources.

It also said there were delays in getting products from Canadian producers and that tariffs would “excruciatingly” hurt retail stores of all sizes, especially since they were already struggling due to COVID-19. 

The tone surrounding this issue was uncharacteristic of the Retail Council, which normally does not pick sides, but went so far as to set up portals for anonymous contributions to fight against the tariffs this year.

And now, even after the tribunal’s ruling, Retail Council of Canada President and Chief Executive Officer Diane Brisebois is not giving up. 

“Let me be clear, we will keep fighting this,” she said in an interview Friday. “This is a ridiculous, disappointing and devastating way of ignoring the future of Canadian retailers and we’re exploring all options to appeal this decision.”

In an interview Friday, Palliser Chief Executive Peter Tielmann said he’s pleased with the tribunal outcome because it levels the playing field. “I think the Retail Council should accept it for what it is and work with everyone on the same page,” he said.

He pointed to the fact that Canadian furniture producers saw their domestic market share plunge from 48 per cent in 2017 to 32 per cent by 2020.

“We want to be able to compete with everyone,” Tielmann said. “But that can only happen if there’s fair play involved — not what China and Vietnam were doing. All this does is just level them out to the same prices as everyone else.”

Had this not happened, Palliser and other manufacturers would have walked away from Canada and set up shop elsewhere, Tielmann said. “Now, we can actually create jobs and have Canada-made products at Canadian sales floors from coast to coast,” he added.

But Brisebois isn’t so pleased. “To assume manufacturers are the only ones creating jobs is just preposterous,” she said.

“At the end of the day, this will affect regular customers who need to be prepared to pay a whole lot more for their sofas, beds and other furniture. That’s why we’ll keep fighting for them.”